IT is key to future business growth
Published: 04 May 2007 16:28 BST
…the cost-effectiveness of offshore production and the on-the-ground expertise needed to manage projects at the highest level, delivering the revenue-generation support required by today's chief executives.
The key to this is in the engagement process, and the ability to provide the customer with the best on-the-ground project management and industry skills available. We advocate using a "two-in-a-box" model, which pairs these industry experts with their colleagues offshore so that projects stay on course. This means that when there is a better and/or quicker way to do something it is spotted and implemented immediately, with the on-site outsourcing team responsible for driving the offshore team as and when the client's needs change. When all the competition in a market is heading in the same direction, a faster start can reap huge benefits in terms of "first mover advantage".
Integration, integration, integration
To ensure the contribution of IT to business goals, companies need to integrate outsourcing operations across their organisation. By tightly integrating the providers' teams into the client's business, the impact of the relationship is naturally bigger and can be felt sooner. Whether it be delivering a new product faster, improving margins, reducing cost or transforming IT, the efficiency of offshore work combined with the local intimacy fostered through tight integration can rapidly accelerate the impact of IT on business performance. The difference this makes when embarking on complex implementations can be immense, with the potential to break down internal barriers between business and IT departments.
Longer term, fully integrating IT outsourcing across the enterprise yields significant economies of scale. By opening up multiple divisions of a business to a service provider, common build, manage and delivery methodologies, skills and software solutions can be shared and therefore used more effectively and consistently. Scalability — one of the major advantages of outsourcing over build and maintenance in-house — becomes easier and faster with fourth-generation providers, meaning customers have far greater flexibility in reacting to internal or market changes.
Expectations of what IT should deliver to a business are changing. To realise these ambitious expectations of chief executives, IT providers who are capable of driving business transformation through industry expertise, customer intimacy and the ability to drive tighter integration at all levels are essential. The fourth generation outsourcing model can achieve this, because it can deliver more, faster at a lower cost than prior outsourcing approaches. Of course the continued success of this model does require that these offshoring providers keep re-investing in talent ahead of the market whether it be hiring experienced experts or developing raw talent. Only in this way can the customer be assured that they will continue to receive the best advice and expertise available as their relationship develops. But, if the provider is able to do this, then the contribution of offshored outsourcing will continue to move upstream and board confidence in IT's ability to make a real difference to the business will continue to grow.
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